House Hacking in Utah

[Andrew L.]

Hello all, I have a question I would appreciate your insight and advice on. Me and my wife are looking to house hack a multi family unit in either Salt Lake County or Utah County. We are looking to use an FHA loan and only pay 3.5% for the down payment. However, after analyzing a lot of different properties here, it seems like while we would be living there it won't cashflow unless we put down a bigger down payment, like 20%. Is cash flow all to consider when house hacking, or are there other benefits that are outside of that that I'm missing? And after a year we would plan to move into another house hack, but even after moving out it seems that it would barely cashflow. Is this just because the market is so hot right now here in Utah? Has anyone done a successful house hack recently? What do you look for in a house hack? Should we hold off and just continue saving for a bigger down payment? We are really excited and anxious to start out but know that it's better to wait and get a good deal then jump in and get burned financially. Thanks for your help.

[William Hochstedler]

House hacking is merely a way to get better financing on rental properties by taking advantage of owner occupant loans with lower interest rates and higher LTV's.

If you can't find a property that works well as a house hack, you won't be able to find a property that works well as an investment at all. Nobody's suggesting it's easy to find deals right now. But there are definitely properties in both Salt Lake and Utah counties that will be cash-flow positive at 100% LTV.

The whole point of house hacking is to enter the market with a small balance sheet while simultaneously getting the best financing out there.  Saving up to house hack is an oxymoron.